Sustainable adaptive reuse – economic impact of cultural heritage

Abstract

Purpose: The purpose of this paper is to investigate the positive externalities of adaptive reuse of heritage buildings and the economic impact on adjacent residential property prices as adaptive reuse is emerging as a significant heritage management and cultural heritage conservation practice recognized by the International Council on Monuments and Sites. Design/methodology/approach: Through mixed methodologies of hedonic price model and case studies of three tenement houses in Hong Kong, this paper argues that the adaptive reuse of heritage buildings increases the values of residential properties within the district and revitalizes the area economically and culturally because of the positive externalities generated from the cultural heritage. Findings: The findings have identified key cultural heritage values of adaptive reuse via the case studies as well as the major intangible cultural values associated with the heritage assignment. On the other hand, the hedonic regression also verifies that key variables such as heritage completion and distance from heritage show significance to the property prices of adjacent residential units. Practical implications: The research is useful for heritage conservationists, policy makers and urban planners in other cities with regards to management and implementation of sustainable cultural heritage revitalization schemes for economic benefits. Originality/value: The research is original in its scope and context, and is one of the first of its kind for a high-density metropolitan context in Hong Kong and is significant in demonstrating the economic impact of the heritage practice of adaptive reuse.